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Starting a business in the US

Starting a business in the US

Old Sep 30th 2009, 10:06 pm
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Default Starting a business in the US

Hi All,

For the past few years my wife and I have been planning a relocation to the US. Family life has got in the way of this, we've postponed out plans numerous times due to family illness and having kids. We're due our third child next year and we think it is about time we get on with our dream.

In the past we have run a business here in the UK - although not at the moment, and we are in the process of starting a new venture now. We see our future very much in the US and establishing an American base of operations for out business. I've started investigating opening up an LLC in the US, mainly in the state of Delaware with virtual office facility. This will be our US base of operations and due to the nature of the business, all transactions can be processed online and work carried out by a network of freelancers working form home to begin with while we set-up. When we transfer over (L1) we will formally establish a permanent office with workers on both sides of the Atlantic.

I have looked into setting up the LLC and also into the opening of a Bank account for this business. I have called a couple of banks, the usual suspects if you will, and asked the procedure for opening an account. Most of the people I speak to are clueless or insist I must be a US resident. I have read conflicting advice on this and was wondering if anyone out there has had any experience on setting up an LLC and opening a business bank account as a foreign national who is not currently resident in the US and will not be for a while. We will not be coming over for 18 months, partly to let the business establish itself but mainly to allow our families the chance to see the new arrival before we leave them forever....

In terms of the UK business, we will be running this in the first instance, and handing over to a trusted manager when we move to the US. The US side of the business will be run by a close friend of mine who is a US citizen. In terms of opening an account, I would prefer to do everything remotely if possible, as I don't want to leave my wife for extended periods of time. Obviously if I have to travel in person to open an account I will - but if there is a way this can be done remotely I would be very happy.

Any recommendations on companies/agencies that I can use as a total one stop shop for creating the US LLC and obtaining a bank account would be appreciated - as will any tips to do this with minimal expense.

Thanks for your time
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Old Oct 1st 2009, 5:19 am
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Default Re: Starting a business in the US

www.LegalZoom.com

I presume you have consulted with a US Immigration lawyer concerning the practicality of your plan.
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Old Oct 1st 2009, 5:46 am
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Default Re: Starting a business in the US

Originally Posted by Boiler View Post
www.LegalZoom.com

I presume you have consulted with a US Immigration lawyer concerning the practicality of your plan.
Exactly. Sounds like you need to figure out the visa sitution before you worry about setting up shop.

A lot of people make the mistake of worrying about other details (eg bank accounts in this case) before they have figured out a concrete plan for the visa.

I don't think you can necessarily just employ yourself on an L1 that easily. To my untrained eye an E-visa might be more appropriate.

There are others on here who know much more about that.

What happened when you tried to move to Florida in 2006?
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Old Oct 1st 2009, 3:37 pm
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Default Re: Starting a business in the US

Originally Posted by barryauk View Post
In the past we have run a business here in the UK - although not at the moment,
Barry ..you are dreaming again mate ... it aint gonna happen
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Old Oct 1st 2009, 5:32 pm
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Default Re: Starting a business in the US

A remote business? I don't think that'll fly....definitely get input from a immigration lawyer first...
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Old Oct 1st 2009, 5:43 pm
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Default Re: Starting a business in the US

OK Barry ...New idea
make an appointment here and lay out your plan ...
http://www.usvisalawgroup.com/
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Old Oct 1st 2009, 5:48 pm
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Default Re: Starting a business in the US

Originally Posted by Ray View Post
OK Barry ...New idea
make an appointment here and lay out your plan ...
http://www.usvisalawgroup.com/
Surely the OP would not be asking these sort of questions if he had not already had this checked out from an Immigration persepective.
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Old Oct 1st 2009, 5:59 pm
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Default Re: Starting a business in the US

Originally Posted by Boiler View Post
Surely the OP would not be asking these sort of questions if he had not already had this checked out from an Immigration persepective.
I bet he has been to Disney ....
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Old Oct 1st 2009, 6:00 pm
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Default Re: Starting a business in the US

Originally Posted by caleyjag View Post

What happened when you tried to move to Florida in 2006?
We have looked at a few different visa options, the L1 seems the best route for us.

As for what happened to our move in 2006. We were on target for this, but my mother fell seriously ill with cancer and subsequently passed away. We put all our plans on hold, shut down our business and basically spent as much time as we could with her, looking after her and the rest of the family. This was a very difficult time for us and we sacrificed a lot, including a successful business and an L1 application. If we had continued with the L1 we would be in the US now, but then I would have missed the short time I had with my mother and my kids would not have any memories of their grandmother. Since then I have been contracting and earning decent money but without the hassle of running a business, allowing our family to heal. We are now mentally, physically and financially in a position to continue with our dreams.

To me there are more important things in life than just money and business etc. My family has and always will come first. I would not change the decision my wife and I made back then.

We thought about making this earlier this year, but we decided we wanted to have a third child in the UK first. Our new addition will be due in February. This is why we are beginning to plan our move now, with a view to entering the US to expand in 18 months or so. Our youngest will be about 1 year old then, have all the shots required and our parents will have had chance to see the little one before we go.

The L1 seems the logical choice to us, as we enjoy running a business. We want to have a presence here and in the US for the business so we can capture two different markets. We are not setting this business up as a means to get to the US. I won't go into the ins and outs of the business, but our aim is to build this to a sufficient level to support the L1 option. We already have our management team for the UK side lined up, as well our first batch of key employees. Whilst an E visa is an option to us, we are using this more as a backup. Mainly because I am prepared to invest equally in a UK and US operation. From a securities point of view this makes more sense as if one business fails (yes I will lose L1 entitlement) but the surviving business will still provide an income to our family.

There is also the H1B option available to us, both my wife are highly skilled/qualified and could look for work and take this option if we wanted to. However, we have always preferred to work for ourselves and run our own business. It has enabled us to have a very close family and allowed us to enjoy ourselves.

I know my question is vague, but the reason I ask about bank accounts rather than "visa questions" is that I have already met with an immigration lawyer and discussed the situation (now and on the previous application), and there is an abundance of information and experience here and elsewhere on the web for this.

I have always found it good to get first hand experience if possible, and obviously any one with experience with a similar situation could provide useful information.

Last time I worked in the US (legally btw) I had an account with a local bank close to where I was working. I had no problems opening this, but this was pre 2001 and I was able to open this in person. This time the situation is different, mainly because I don't really want to leave my wife alone with our kids, especially as she is pregnant. All of us flying over is not an option, as our kids are in school and my wife doesn't want to fly.

Sorry for the long rambling post, but I just wanted to explain our situation, where we are at and that what may seem a pipe dream to some is not to us. We have a very firm plan and time-scales on what we must do. I have a business partner in the states already, someone who I trust and have worked with previously. We have spent 9 months working on the business plan for the UK side of the business alone.

Just to clarify a few points. The UK operation will be moving into an office and be employing approximately 5 full time staff from day 1. This is set to rise to about 20 people by the end of year 1. The US side of the business will initially be run through a virtual office with a network of independent/freelance sales people bringing in work from the US market. This work will be completed by our UK team until a US office has been established. We will have eventually both a UK and US based sales team. The remote work will only be temporary until we can find permanent office space and hire our own in house team. The US sales team will start relatively small with approximately 5 full time staff and rise as required to meet the needs of the business, expanding into other personnel as well. The US LLC is to give more legitimacy to the US market, and allow it to run as a separate legal entity, take payments natively and pay taxes (rightly or wrongly) on US sales to the US government. UK and European sales will be processed by the UK company.

Last edited by barryauk; Oct 1st 2009 at 6:04 pm.
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Old Oct 1st 2009, 8:47 pm
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Default Re: Starting a business in the US

Well, it sounds like a cunning plan Barry - hope it works out for you. How big does a company have to be before you can do the L1 option? I was under the impression they were generally for pretty big and well established companies.
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Old Oct 1st 2009, 9:16 pm
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Default Re: Starting a business in the US

The US LLC is to give more legitimacy to the US market.
Why do you believe this, I ask as we have a LLC but I doubt if any of our customers know this. Which variant has your Accountant recommended. We are not in the same business line so I doubt if our logic would apply to you.

take payments natively and pay taxes (rightly or wrongly) on US sales to the US government.
I thought you said you would be based in Delaware.

A lot of this sounds something that the boots on the ground, your US manager, should be organising.
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Old Oct 1st 2009, 10:05 pm
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Default Re: Starting a business in the US

Originally Posted by Boiler View Post
Why do you believe this, I ask as we have a LLC but I doubt if any of our customers know this. Which variant has your Accountant recommended. We are not in the same business line so I doubt if our logic would apply to you.
As a non US resident I am only able to establish a C-Corp or LLC. We have had an LLC recommended due to the ease of running one compared to C Corp and the pass through taxation that an LLC provides that will be available to us when we move.

I had thought S Corp, but until we are stateside this is not an option.

I imagine the majority of our customers would not notice, and in theory we could sell to the US under our exsiting company in the UK and just establish a local office in the US and employ freelance sales in the same manner, but I would prefer to runt he US side out of the US and start building company history. It can only be a good thing. Worst case scenario is that we do just that - run everything through the UK, just charge in dollars for the US, and convert the invoice amounts to pound sterling based on the rate provided by HMRC in our accounts.

Originally Posted by Boiler View Post
I thought you said you would be based in Delaware.

A lot of this sounds something that the boots on the ground, your US manager, should be organising.
Yes we are, but as we will be selling within the US I believe we will be liable for federal taxes and the annual state tax (franchise fee) in Delaware of $250. There will also be complications when we set up local offices. Whilst I intend for our HQ to be in Delaware I hope to open an office on the west coast - mainly to take advantage of the time zone differences. My understanding is that we have to apply to do business in the state, in which case any sales generated in the same state as the office will have to pay state tax and also file returns in each location there is in an office.

Nothing is ever clear cut, and I'm sure professional opinion will be divided depending on who you speak to and how they prefer to do things. Another reason for asking - learn from other peoples experiences.

My manager in the US will be taking care of the day to day running and is assisting with information where he can, but I am trying to gather a fuller understanding of how things work. I'm very hands on and I like to do as much as I can myself. Just who I am. I could let him do everything, but where is the challenge in that.
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Old Oct 1st 2009, 11:19 pm
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Default Re: Starting a business in the US

Originally Posted by barryauk View Post
As a non US resident I am only able to establish a C-Corp or LLC. We have had an LLC recommended due to the ease of running one compared to C Corp and the pass through taxation that an LLC provides that will be available to us when we move.

I had thought S Corp, but until we are stateside this is not an option.

I imagine the majority of our customers would not notice, and in theory we could sell to the US under our exsiting company in the UK and just establish a local office in the US and employ freelance sales in the same manner, but I would prefer to runt he US side out of the US and start building company history. It can only be a good thing. Worst case scenario is that we do just that - run everything through the UK, just charge in dollars for the US, and convert the invoice amounts to pound sterling based on the rate provided by HMRC in our accounts.



Yes we are, but as we will be selling within the US I believe we will be liable for federal taxes and the annual state tax (franchise fee) in Delaware of $250. There will also be complications when we set up local offices. Whilst I intend for our HQ to be in Delaware I hope to open an office on the west coast - mainly to take advantage of the time zone differences. My understanding is that we have to apply to do business in the state, in which case any sales generated in the same state as the office will have to pay state tax and also file returns in each location there is in an office.

Nothing is ever clear cut, and I'm sure professional opinion will be divided depending on who you speak to and how they prefer to do things. Another reason for asking - learn from other peoples experiences.

My manager in the US will be taking care of the day to day running and is assisting with information where he can, but I am trying to gather a fuller understanding of how things work. I'm very hands on and I like to do as much as I can myself. Just who I am. I could let him do everything, but where is the challenge in that.
Is it really worth all this effort? This seems remarkably contrived and stressful to live in a place with no healthcare and an increasingly undereducated and incensed right wing.
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Old Oct 1st 2009, 11:53 pm
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Default Re: Starting a business in the US

Originally Posted by hereandthere View Post
Is it really worth all this effort? This seems remarkably contrived and stressful to live in a place with no healthcare and an increasingly undereducated and incensed right wing.
I realize you may be just curious, but was it really worth the effort to make the post? The person is clearly passionate about his idea and has already put a lot of effort and research into it. What does it benefit for you to criticize with half-info?
It's not that there is no healthcare here, it just may not be the flavor you are used to. Hard to argue with the last part though.

I'm just sayin'.. the guy is asking a reasonable quesiton about opening a bank account, we got the visa quals established. I don't think he's going to rethink his plan because it looks stressful to you.
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Old Oct 1st 2009, 11:57 pm
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Default Re: Starting a business in the US

As a non US resident I am only able to establish a C-Corp or LLC. We have had an LLC recommended due to the ease of running one compared to C Corp and the pass through taxation that an LLC provides that will be available to us when we move.

I had thought S Corp, but until we are stateside this is not an option.
Way beyond this topic but I would mention that you can establish a LLC but be taxed as a S Corp, for example. I do not know if you would need to be resident, I am assuming you will need an ITIN.

I imagine the majority of our customers would not notice, and in theory we could sell to the US under our exsiting company in the UK and just establish a local office in the US and employ freelance sales in the same manner, but I would prefer to run the US side out of the US and start building company history. It can only be a good thing. Worst case scenario is that we do just that - run everything through the UK, just charge in dollars for the US, and convert the invoice amounts to pound sterling based on the rate provided by HMRC in our accounts.
Might be easier until the busies is established.

Yes we are, but as we will be selling within the US I believe we will be liable for federal taxes and the annual state tax (franchise fee) in Delaware of $250. There will also be complications when we set up local offices. Whilst I intend for our HQ to be in Delaware I hope to open an office on the west coast - mainly to take advantage of the time zone differences. My understanding is that we have to apply to do business in the state, in which case any sales generated in the same state as the office will have to pay state tax and also file returns in each location there is in an office.
I am not sure what you are trying to achieve, but I thought you would be etailing, a physical office seems a big extra cost, and its only a 3 hour difference if its just telephone sales support. And why make yourself less competitive in charging west coast sales tax?

Nothing is ever clear cut, and I'm sure professional opinion will be divided depending on who you speak to and how they prefer to do things. Another reason for asking - learn from other peoples experiences.
I doubt if many on this site have tried to do anything remotely akin to what you are. Especially without being here, it is very easy to assume things are the same when they are very different.

My manager in the US will be taking care of the day to day running and is assisting with information where he can, but I am trying to gather a fuller understanding of how things work. I'm very hands on and I like to do as much as I can myself. Just who I am. I could let him do everything, but where is the challenge in that.
Not so much a challenge but a lot of these issue are the minutae, better to spend your time on the strategic issues. Let the Managers/Accountants/Lawyers do with local routine. I know the issues in my State from experiance being here, another State and its another learning curve.

Sort of like the Yanks in the UK not believeing there is a TV License, loads of equivalent issues in the US.
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